Under standard accounting rules, it is possible for a company’s liabilities to exceed its assets. When this occurs, the owners’ equity is negative. Can this happen with market values? Why or why not?

Principles of Accounting Volume 1
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Chapter3: Analyzing And Recording Transactions
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Problem 28MC: What is the impact on the accounting equation when stock is issued, in exchange for assets? A. both...
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Under standard accounting rules, it is possible for a company’s liabilities to exceed its assets. When this occurs,
the owners’ equity is negative. Can this happen with market values? Why or why not?

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